UNITED STATES DEPARTMENT OF TRANSPORTATION 

FEDERAL AVIATION ADMINISTRATION 

WASHINGTON, D.C. 

IN THE MATTER OF 

GREEN AVIATION MGT. CO. 

For fees and expenses imder the 

Equal Access to Justice Act 

DOCKET NO. CP07EA0003 

(EAJA Proceeding) 

DMS NO. FAA-2007-26989 

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FAA'S RESPONSE TO ORDER FOR FURTHER BRIEFING 

In accordance with the FAA Decisionmaker's Order for Further Briefing Served June 14, 

2010, the Federal Aviation Administration (FAA), by and through the Regional Counsel for the 

Eastern Region, and his designated and authorized representatives, files this response. 

Issues for Further Briefing 

I. Whether the ALJ's dismissal of the proceedings with prejudice after the 

FAA voluntarily withdrew its complaint resulted in a material alteration 

of the legal relationship of the parties required under Buckhannon? 

n. If the ALJ's dismissal with prejudice resulted in a material alteration of 

the legal relationship of the parties, did it have the '^judicial imprimatur" 

required under Buckhannon'! 

ni.If Green Air is a prevailing party, was the FAA's position in the underlying 

litigation substantially justiHed? 
ARGUMENT 

I. The Buckhannon Standard for a Prevailing Party Under 5 U.S.C. § 

504(a) (1). 

Under 5 U.S.C. § 504(a) (1), a party is not eligible for attorney's fees unless he/she is a 

"prevailing party." The meaning of "prevailing party" under the EAJA is governed by the 

Supreme Court's decision in_Buckhannon, which requires a judicially-sanctioned material 

alteration of the legal status of the parties that derives from a ruling based on the merits of the 

case. 

In Buckhannon, the plaintiff operated assisted living residences and was ordered to close 

them because some of the residences were incapable of "self-preservation" as defined imder 

West Virginia law. Buckhannon, the plaintiff, then sued the state, contending that the state's 

"self-preservation" requirement violated the Fair Housing Amendments Act (FHAA) and the 

Americans with Disabilities Act (ADA). After the lawsuit was filed, but before the district court 

judicially resolved the matter, the state legislature eliminated the "self-preservation" requirement, 

and West Virginia moved to dismiss the case as moot. The district court granted the motion, 

dismissing the case, and Buckhaimon requested attorney's fees under the fee-shifting provisions 

of the FHAA and the ADA. Buckhannon contended that he was eligible for an award of 

attorney's fees imder the "catalyst theory," under which a plaintiff may be considered a 

"prevailing party" if its lawsuit achieved the plaintiffs desired result through a voluntary change 

in the defendant's conduct even if the plaintiff did not receive any judicial relief 

The holding in Buckhannon applies broadly to fee shifting statutes. Although the plaintiffs in 

Buckhannon sought attomey's fees under the FHAA and the ADA, the Covirt indicated that its 
analysis applied generally to fee-shifting statutes invoking the term "prevailing party." 

Buckhannon, 532 U.S. at 600,603 n.4. Specifically, the Court stated, "[w]e have interpreted 

these fee shifting provisions consistently, and so approach the nearly identical provisions at issue 

here." Id. (citation omitted); see also John T. v. Del. County Intermediate Unit, 318 F.3d 545, 

557 (3d Cir. 2003) (finding that Buckhannon has broad applicability and applies to the 

hidividuals with Disabilities Act); J.C. v. Reg'lJSch. Dist 10, Bd. ofEduc^ 278 F.3d 119,123-24 

(2d Cir. 2002) (stating that "the decision [in Buckhannon] expressly signaled its vwder 

applicability"). Accordingly, courts have concluded that the rule fix)m Buckhannon applies to the 

"prevailing party" threshold requirement under the EAJA. Ma v. Chertoff, 547 F.3d 342,344 

(2d. Cir. 2008) (concurring with seven other U.S. Courts of Appeals that ^Buckhannon's 

definition of 'prevailing party' applies to fee requests under EAJA"), 

Buckhannon's interpretation of the term "prevailing party" applies to both prevailing 

defendants and plaintiffs. See District of Columbia v. Straus, 590 F.3d 898,901 (D.C. Cir. 

2010); District of Columbia v. Jeppesen, 514 F.3d 1287,1290 (D.C. Cir. 2008); see also Avery. 

First Resolution Management Corp., 568 F.3d 1018, 1024 (9th Cir. 2009); Oscar v. Alaska Dep't 

ofEduc. & Early Dev., 541 F.3d 978, 981 (9th Cir. 2008); RFR Indus., Inc. v. Century Steps, 

Inc., 477 F.3d 1348,1353 (Fed. Cir. 2007); Highway Equip Co. v. FECO, Ltd., 469 F.3d 1027, 

1035 (Fed. Cir, 2006); Dattner v. Conagra Foods, Inc., 458 F.3d 98,102 (2d Cir. 2006); Mr. L v. 

Sloan, 449 F.3d 405,407 (2d Cir. 2006); Claiborn v. Wisdom, 414 F.3d 715, 719 (7th Cir. 2005). 

The D.C. Circuit has recently applied Buckhannon to EAJA in the administrative context 

Turner and Coonan v. NTSB, 608 F.3d 12 (D.C. Cir. 2010). Accordingly, Buckhannon governs 

Green's request for attomey's fees in this case. 
U. Because the FAA's voluntary change in conduct—withdrawal of the 

complaint—did not result in a judicially-sanctioned material alteration of the 

legal relationship of the parties, it lacks the necessary **judicial imprimatur'' to 

establish prevailing party status under the Buckhannon standard. 

In this case, the FAA voluntarily withdrew its complaint prior to the commencement of the 

hearing. The ALJ, in turn, pursuant to section 13.215 of the Rules of Practice in FAA Civil 

Penalty Proceedings (FAA Rules of Practice), 14 C.F.R. § 13.215, dismissed the proceedings 

with prejudice. Significantly, the AU did not make any findings on the merits, or issue any 

order regarding the charges in the complaint that the FAA voluntarily withdrew. Instead, the 

ALJ simply followed the requirements of section 13.215 and dismissed the proceedings with 

prejudice. Notwithstanding that pursuant to section 13,215 that dismissal was with prejudice to 

the FAA, it did not satisfy Buckhannon. Even assimiing that the dismissal with prejudice 

constituted a material alteration of the legal status of the parties, such alteration was the result of 

completely voluntary conduct on the part of the FAA and was not judicially sanctioned. Neither 

the ALJ nor the FAA Decisionmaker granted any relief on these charges in favor of Green. 

Indeed, section 13.215 left the ALJ with no option other than to dismiss the proceedings with 

prejudice. Under these circumstances, a voluntary dismissal with prejudice does not provide the 

"judicial imprimatur" required by Buckhannon. 532 U.S. at 605. 

The Supreme Court in Buckhannon held that the term "prevailing party", which is used in 

numerous federal fee-shifting statutes, is limited to a party "who has been awarded some relief by 

[a] court."' Buckhannon, 532 U.S. at 602-03. The Supreme Court has emphasized that "[t]he 

^ As noted above, the Court of Appeals for the District of Columbia Circuit along with nearly every other Court of 

Appeals has determined that Buckhannon's interpretation of "prevailing party" applies to EAJA. Consol. Edison Co. 

ofN.Y., Inc. V. Bodman, 445 F.3d 438, 447 (D.C. Cir. 2006); Select Milk Producers. Inc. v. Johnson, 400 F 3d 

939,945 (D.C. Cir 2005); Thomas v. NSF, 330 F.3d486,492 n.l (D.C. Cir. 2003); see also Aronov v. Napolitano, 

4 
touchstone of the prevailing party inquiry must be the material alteration of the legal relationship 

of the parties," Texas State Teachers Ass 'n v Garland Ind Sch. Dist., 489 U.S. 782, 792-93 

(1989), cited with approval in Buckhannon, 532 U.S. at 604. The EAJA does not authorize an 

award of attomey's fees when the United States has not been prevailed against. Kentucky v. 

Graham, 473 U.S. 159,165 (1985). Even where the government has been prevailed against, a 

prevailing party is not entitled to fees for unsuccessful claims that are separate and distinct fi*om 

those claims on which the party prevailed. Hensley v. Eckerhart, 461 U.S. 424,440 (1983) 

("Where the plaintiff has failed to prevail on a claim that is distinct in all respects fi-om his 

successful claims, the hours spent on the unsuccessful claims should be excluded in considering 

the amount of a successful fee."). 

Under Buckhannon, a party that has received a successful judgment on the merits, a courtordered consent decree, or a judicially-approved settlement may be entitled to an award of 

attomey's fees. ^ 532 U.S. at 604. But a party that has achieved a desired result of the litigation is 

not a "prevailing party" if that desired result was the outcome of entirely voluntary conduct on 

the part of one party, with no judicial ^proval, and did not yield a court-ordered "material 

alteration of the parties" Id. . The Supreme Court concluded that "enforceable judgments on the 

merits and court-ordered consent decrees create the 'material alteration of the legal relationship 

of the parties' necessary to permit an award of attomey's fees." Id. (quoting Garland, 489 U.S. 

at 792-93). It distinguished these acts (judgments on the merits and court-ordered consent 

562 F.3d 84, 89 (1st Cir. 2009); Ma v. Chertoff, 547 F.3d 342,344 (2d Cir. 2008); Morillo-Cedron v. U.S. 

Citizenship & Immigration Serv., 452 F.3d 1254,1257-58 (11th Cir. 2006); Goldstein v. Moatz, 445 F.3d 747, 752 

(4th Cir. 2006); Marshall v. Comm 'r ofSoc. Sec, AAA F.3d 837, 840 (6th Cir. 2006); Brickwood ConO-actors, Inc. v. 

United States, 288 F.3d 1371, 1379-81 (Fed. Cir. 2002); Perez-Arellano v. Smith, 279 F.3d 791, 797 (9th Cir. 2002). 

^ Unlike a court, the FAA's Rules of Practice do not audiorize an ALJ to issue a consent decree or to sanction a 

settlement agreement 

5 
decrees) fi-om "[a] defendant's voluntary change in conduct" in that such voluntary changes, 

"although perhaps accomplishing what the [other party] sought to achieve by the lawsuit, lackQ 

the necessary judicial imprimatur on the change" to confer prevailing party status." Id. at 605 

(alterations added).^ Thus, the Buckhannon Court rejected the "catalyst" theory and any other 

theory that allows an award where there is no judicially-sanctioned change m the parties' legal 

relationship, A party that has achieved merely a desirable result is not a prevailing party if that 

result was the outcome of entirely voluntary conduct on the part of the other party, had no 

judicial approval or sanction, and did not yield a court-ordered "material alteration of the legal 

relationship of the parties," 

Following Buckhannon, the District of Columbia Circuit "articulated a three-part test for 

determining prevailing party status: (1) there must be a 'court-ordered change in the legal 

relationship of the parties; (2) the judgment must be in favor of the party seeking the fees; and (3) 

the judicial pronouncement must be accompanied by judicial relief" Straus, 590 F.3d at 901 

(quoting Thomas v. NSF, 330 F,3d 486,492-93 (D.C. Cir. 2003)). 

The National Transportation Safety Board, in Application of Turner and Coonan, NTSB 

Order EA-5467,2009 WL 2419616 (July 27,2009), which is analogous to the subject case, 

applied the D.C. Circuit's standard and Buckhannon to the definition of "prevailing party" under 

the EAJA's administrative fee-shifting provision.^ In that case, the Board found that: the 

applicants did not prevail on any portion of the merits of the case because the Administrator 

^ In Aronov v. Napolitano, 562 F.3d 84,89 (1st Cir. 2009), the court determined that receipt of "a Judgment on the 

merits" or obtaining "a court-ordered consent decree" are the only two situations that Buckhannon explicitly 

identified as meeting the requirement for judicial imprintiatur. See Buckhannon at 60S. 

'^ Moreover, the Board in Turner and Coonan recognized that smce an award of attomey's fees under the EAJA 

qualifies as a waiver of sovereign immunity, the provision and application of the EAJA must be construed narrowly 

and in fevor of fee government. Turner and Coonan at *7. See also, e.g., Aronov, 562 F.3d at 88 ("The EAJA is 
withdrew the complaint before the hearing was held; the ALJ did not issue an order akin to a 

coizrt-supervised consent decree; the ALJ merely accepted the Administrator's withdrawal of the 

complaint; and the voluntary withdrawal of the charges was not with prejudice nor did it in any 

way alter the relationship of the parties. Id. at *6. 

The Covirt of Appeals for the District of Columbia Circuit affirmed the Board's decision, 

finding "it clear that the pilots received nothing akin to judicial relief and therefore were not 

prevailing parties." Turner and Coonan at 13. The Court fiirther fotmd that there was nothing 

analogous to judicial relief even though the ALJ dismissed the cases, because: 

Once the FAA withdrew its complaints, the pilots were no longer the subject of 

proceedings to suspend their licenses. For all practical purposes, the FAA had 

unilaterally ended the adversarial relationship between the parties, leaving them where 

they were before the complaint was filed. The order of the ALJ dismissing the cases was 

just an administrative housekeeping measure, not a form of relief, because the FAA did 

not need the ALJ's permission to withdraw a complaint See 49 C.F.R. § 821.12(b) 

("Except in the case of... a complaint .„ pleadings may be withdrawn only upon approval 

of the [ALJ] or the [NTSB]"). Had the ALJ done nothing, the pilots would have been in 

essentially the same position as they were after the ALJ dismissed this case. These 

circumstances do not make them prevailing parties according to the criteria of 

Buckhannon as interpreted in Straus.^ 

Id. at 15. The action at issue in Turner was brought imder section 821.12(b) of the Board's rules, 

49 C.F.R. § 821.12(b), which, unlike section 13,215, the provision at issue in the case at bar, 

does not direct that the complaint be dismissed with prejudice. This distinction, however, does 

not aid Green. As the Turner and Coonan court explained, although a party need not necessarily 

receive final judgment on the merits or a consent decree to be considered prevailing, a party, at 

also a waiver by the government of its sovereign immunity and so must be construed strictly in favor of the 

government.") \c\tm%Ardestaniv. INS, 502 U.S. 129, 137 (1991)). 

' The court in Turner and Coonan noted that under the test articulated in Straus, "a party need receive only some 

form of judicial relief not necessarily a court-ordered consent decree or a judgment on the merits." Turner and 

Coonan, 608 F.3d at 15. 

7 
the very least, needs to receive "some form of judicial relief." 608 F.3d at 15 (citing D.C. v. 

Straus, 590 F.3d 898,901 (D.C. Cir. 2010) (emphasis added)). In otiier words, legal relief ve/ 

non, such as the dismissal with prejudice mandated by the procedural mles in this case, is not 

sufficient to confer prevailing party status. Instead, such relief must be judicially imposed in 

some way. 

Section 13.215 of the FAA's Rules of Practice requires the ALJ to automatically dismiss 

the proceedings with prejudice whenever the FAA withdraws the complaint. Thus, the voluntary 

withdrawal of a complaint before a hearing under section 13,215 has the same effect under 

Buckhannon as the withdrawal considered by the D.C. Circuit in Turner and Coonan under 

49 C,F,R, § 821,12(b). In both instances, voluntary withdrawal of a complaint terminates the 

litigation automatically, leaving the ALJ with no discretion or choice in determining the outcome 

of the case. Accordingly, although (jreen achieved the desired result of the litigation—^the 

FAA's withdrawal of the complaint—the v^thdrawal was not the result of any ruling or exercise 

of authority or discretion by the ALJ. Because the FAA's voluntary change in conduct— 

withdrawal of the complaint—did not result in a judicially-sanctioned material alteration of the 

legal relationship of the parties, it lacks the necessary "judicial imprimatur to establish 

prevailing party status under Buckhannon. 532 U.S. at 605-606, 

The line of circuit court cases considering, imder Buckhannon, whether a district court 

had authority to exercise discretion whether or not to dismiss the complaint with or without 

prejudice, is illustiative. See Claiborne v. Wisdom, 414 F.3d 715, 719 (7th Cir. 2005) ("The 

critical fact is not what prompted the district court to act; it is instead what the district court 

decided to do. Here, the language of the district court's judgment makes it clear that a decision 

8 
on the merits has been rendered."); Highway Equipment Co., Inc. v. FECO, Ltd., 469 F.3d 1027, 

1034 ("[T]he district court exercised its discretion in dismissing the patent claims raised in the 

underlying action with prejudice pursuant to Fed. R, Civ, P. 41(a)(2), That mle provides in 

relevant part that 'an action shall not be dismissed at the plaintifiPs instance [after answer] save 

upon order of the court and upon such terms and conditions as the court deems proper.'"); Miles 

V California, 320 F.3d 986,989 (9th Cir. 2003) (holding that dismissal of tiie underlying case 

without prejudice to plaintiffs right to seek relief in state court is a material alteration of the in 

the relationship of the parties under Buckhannon because the dismissal eliminates the federal 

Americans with Disabilities Act claim fix>m further proceedings in federal court). Under this 

case law, the touchstone for the inquiry of whether the voluntary withdrawal of a complaint 

results in a judicially-sanctioned material alteration of the legal relationship of the parties and, 

therefore, has the necessary "judicial imprimatur" is whether the court has the discretion over the 

outcome of the case. Where the court has such discretion, its ruling or order creates the 

necessary "judicial imprimatur" to establish prevailing party status under Buckhannon. 

See Buckhannon, 532 U.S. at 605-606. Conversely, where the court does not possess discretion 

over the outcome of the case, voluntary withdrawal of a complaint will not have the necessary 

judicial sanction or imprimatur. 

Also illustrative is the case law applying Buckhannon to private settlement agreements, 

Buckhannon itself explicitly distinguished between private settiement agreements accompanied 

with an order dismissing a case and court-ordered or supervised consent-decrees, Buckhannon, 

532 U.S. at 605, hi Aronov v. Napolitano, 562 F,3d 84 (1st Cir. 2009), the First Circuit 

explained this distinction. In Aronov, the court considered an order by a district court remanding 
a case to an agency pursuant to a settiement agreement between the two parties. The court 

analyzed the qualities that make a court's order sufficientiy similar to a court-ordered consent 

decree so as to find prevailing party status under Buckhannon. Agreeing with other circuits, the 

Aronov court found that whether an order could be formally labeled a "consent decree" was not 

dispositive to vkiiether a court order was sufficient to confer prevailing party status on a plaintiff 

or defendant, 562 F,3d at 90, Instead, the court observed that the prevailing-party inquiry should 

focus on "whether the order contains the sort of judicial involvement and actions inherent in a 

'court-ordered consent decree.'" Id. To that end, the court noted that Buckhannon described 

what it meant by a "court-ordered consent decree" by distinguishing them fi'om "private 

settlements." Id. The court observed that Buckhannon contained three factors that distinguished 

court-ordered cotisent decrees fi-om private settlement agreements: (1) the "change in the legal 

relationship [is] court-ordered"; (2) there must be "judicial approval of the relief vis-a-vis the 

merits of the case"; and (3) there must be "judicial oversight and ability to enforce the obligations 

imposed on the parties." 562 F.3d at 90 (citing Buckhannon, 532 U,S. at 604; id. (citing 

Kokkonen v. Guardian Life Insurance Co. of America, 511 U.S. 375,381 (1994)); id. at 604 n.7). 

The court noted that these factors are typically present in consent decrees because, unlike 

settiement agreements, they are orders of the court, approved by the court, and are subject to its 

oversight. 562 F.3d at 91 (citing Smyth v. Rivero, 282 F.3d 268,281 (4th Cir. 2002)). 

Furthermore, "[cjourt approval of a consent decree must involve some appraisal of the merits." 

Id. (citing Smyth, 282 F.3d at 279), The court must also make sure that the terms of a consent 

decree are fair and not unlawful. Id (citing Smyth, 282 F,3d at 279). Most importantiy, a consent 

decree is obligatory on the parties and may be enforced by the court through means such as 

10 
contempt. Id. Aronov found that the court order in its case, although it granted the plaintiff 

binding legal relief by remanding to the agency as the plaintiff had requested, did not contain 

these essential features of a consent decree, because the agency had voluntarily submitted to such 

an order. Id. at 92. Therefore, the court held that the plaintiff was not a prevailmg party. Id The 

First Circuit's discussion oiBuckhannon in Aronov is instmctive here. In the present 

case, the ALJ's dismissal of the proceedings with prejudice pursuant to the voluntary actions of 

the FAA did not result in an approval or sanctioning of any change in the legal relationship of the 

parties. Rather, it merely was an acknowledgment, required by section 13.215, that the 

complaint had been voluntarily withdrawn by the FAA. Nor was the dismissal order tantamount 

to a court-approved consent decree, as there was no agreed-upon settlement that the ALJ 

approved, nor did the ALJ retain oversight or jurisdiction over the case. See Buckhannon, 532 

U.S. 604 n.7. While it is tme that a voluntary dismissal of a complaint vwth prejudice will result 

in a legal change to the extent that the FAA caimot reinstitute the action, in order to satisfy 

Buckhannon, this change must be the result of judicial action, not the entirely voluntary actions 

of one party. There was no such judicial action in the present case. 

As discussed above, because the FAA's voluntary change in conduct—^withdrawal of the 

complaint—did not result in a judicially-sanctioned material alteration of the legal relationship of 

the parties, it lacks the necessary "judicial imprimatur" to establish prevailing party status under 

the Buckhannon standard. Accordingly, Green is not entitied to an award of attomey's fees and 

other expenses in this case. 

"Prevailing party" status is a "threshold requirement" that every fee appUcant must 

satisfy. See, e.g.. Commissioner, INS v. Jean, 496 U.S. 154,160 (1990) ("hi EAJA cases, the 

11 
court first must determine if the applicant is a 'prevailing party' by evaluating the degree of 

success obtained. If the Government then asserts an exception for substantial justification or for 

circumstances that render an award unjust, the court must make a second finding regarding these 

additional threshold conditions."). The "prevailing party" determination precedes and is 

independent from any consideration of the government's position on the merits. And if the 

applicant cannot establish that he or she is a "prevailing party," the court need not proceed any 

further, for the applicant is not entitled to attomey's fees. 

III. The FAA was substantially justified in its position in the underlying 

litigation. 

Once it is established that the applicant is a prevailing party, the government bears the 

burden of proving that its position in the underlying litigation was substantially justified or that 

special circumstances existed.^ Taucher v. Brown-Hruska. 396 F.3d 1168 (D.C. Cir. 2005). 

"Whether or not the position of the agency was substantially justified shall be determined on the 

basis of the administrative record, as a whole, which is made in the adversary adjudication for 

which fees and other expenses are sought." 5 U.S.C, § 504(a)(1), To prove that its position was 

substantially justified, the agency must demonstrate that its position was reasonable both in law 

and fact. 14 C.F.R. § 14.04(a); Frev v. CFTC. 931 F.2d 1171 (7 Cir. 1991); Natchez Coca-Cola 

th 

Bottiing Co.. Inc. v. NLRB. 750 F.2d 1350 (5 Cir. 1985). As the Supreme Court explained in 

Pierce v. Underwood. 487 U.S. 552, 565 (1988), '"substantially justified' means 'justified to a 

degree that could satisfy a reasonable person,' or having a 'reasonable basis both in law and 

12 
fact.'" Jonesv. Luian. 887 F.2d 1096, 1098 (D.C. Cir. 1989). The substantial justification 

standard "is satisfied if there is a 'genuine dispute,' or if reasonable people could differ as to the 

appropriateness of the contested action." Pierce v. Underwood. 487 U.S. at 565. "To be 

'substantially justified' means, of course, more than merely undeserving of sanctions for 

fiivolousness." Id. at 566, 

The charges in the complaint concerned flights operated under Part 135 to and from the 

Bahamas over a New Year's weekend, with Erin Daly (daughter of Green's Captain on the flight) 

occupying the aircraft jumpseat on each flight. 

At issue was Erin Daly's status on each flight: passenger or crewmember. Green's 

operations specifications authorized the use of the aircraft in nine seats or less operations conducted 

under 14 C.F.R. Part 135. As a passenger, Erin Daly would have been the tenth passenger on 

these flights. A crewmember is a person assigned to perform duty in an aircraft during flight 

time. 14 C.F.R. § 1.1. As a result, at issue was whether Erin Daly was assigned for each flight to 

perform duty in the aircraft during flight time. 

If Erin Daly were a crewmember of Green's on each flight, then she did not have to be 

Green's W-2 "employee", but could have been a contractor. So long as she was assigned to 

perform duty in an aircraft during flight time, she would have been a crewmember. If Erin Daly 

were a contractor or agent for Green, her actions or inactions are attributable to Ckeen and Green 

has to exercise command and control over her activities on its part. 

However, Green cannot rely on 14 C.F.R. § 135.85(a), which provides that an air carrier 

operating under Part 135 may carry a crewmember or other employee of the certificate holder 

^ The FAA's EAJA regulations specifically place the burden of proving that the 

agency's position was reasonable in fact and law on the agency. 14 C.F.R. § 

13 
without complying with the passenger-carrying requirements of Part 135. Section 135.85(a) is 

really designed to allow a cargo carrier to carry only those people listed in section 135.85(a) 

without having to comply with the passenger-carrying mles of Part 135. But, because there were 

actual passengers on board, section 135.85(a) was inapplicable. Under 14 C.F.R. section 119.3, 

'"all-cargo operation' means any operation for compensation or hire that is other than a 

passenger-carrying operation or, if passengers are carried, they are only those specified in 

§§121.583(a) or 135.85 of this chapter." Green's flights were not "all cargo" flights because there 

were passengers on board. 

The administrative record of the case supported these findings of fact by the ALJ: 

• On December 30, 2005, Green operated a Challenger CL600 aircraft on a charter 

flight with passengers firom New York to the Bahamas, returning on January 2, 

2006; 

• Green was authorized under its operations specifications to use the Challenger 

aircraft in nine seats or less operations conducted under Part 135; 

• Green's weight-and-balance sheets (load manifest) list the names of the two pilots 

as crew and include data for nine passengers; 

• Green's quote for the charter flight included a line item for an "attendant" at 

$1,600, which was accepted by the client; 

• Green's trip log, prepared by its customer service representative, listed Erin Daly 

as "FA"; 

• Green's eAPIS report to U.S. Customs and Border Control on the day before the 

flight listed Erin Daly as "crew"; 

• The FAA settled a parallel proceeding against the two Green pilots through the 

FAA dropping the charges and the pilots making no EAJA application; 

• The FAA agreed on May 31, 2007 to drop the charges against Green upon Green's 

submission of an affidavit concerning Erin Daly's employment status (i.e that Erin 

Daly was a Green employee; Green had no records other than pay stubs 

evidencing employment; and no IRS or state records existed to substantiate her 

employment) and Green agreed not to pursue an EAJA application; 

14.04(a) . 

14 
• The settlement with Green did not hold as on June 1, 2007 Green moved to 

dismiss; 

• Green's August 3, 2007 reconsideration motion contained a copy of IRS Form 

1099 listing "nonemployee" compensation for Erin Daly in the amount of $2,100. 

(Initial Decision at 2-3). 

In addition, the ALJ found that Green's customer service representative, wiio provided 

the quotation and created the trip log, informed Green's Captain Deily that if his daughter Erin 

Daly was going on the trip, then she would be expected to primarily perform safety-related duties 

and must be adequately trained to do so, and secondarily serve drinks. (Initial Decision at 5). 

The ALJ foimd that Captain Daly attested he provided his daughter with basic familiarization 

with safety procedures, although she was primarily to serve drinks. (Initial Decision at 6). Based 

on the administrative record, the ALJ concluded that it was not clear whether Green's client had 

contracted for someone who would simply serve drinks and attend to passenger comfort, or have 

onboard a qualified flight attendant trained in safety procedures. 

The ALJ observed that numerous FAA regulations require that a "flight attendant" must 

be trained, knowledgeable, and competent in safety procedures concerning the passengers and the 

aircraft. (Initial Decision at 5). The ALJ also found that Green was not required on the trip to 

provide a qualified flight attendant, as the aircraft was certificated for fewer than nineteen 

passengers, (Initial Decision at 6). 

Green asserted in litigation that Erin Daly occupied a middle ground as a "non-required" 

attendant or cabin aide or cabin attendant, serving drinks, and thus neither as an improperly 

trained flight attendant occupying the aircraft jumpseat, nor as an un-manifested tenth passenger 

on an aircraft certificated for only nine passengers. There was no proof submitted, and there is 

15 
no evidence in the record, except Erin Daly's and Captain Daly's statements submitted after the 

complaint was filed, of how Green as the certificate holder defined Erin Daly's role as a 

contractor or agent, or "non-required" attendant, or indeed what duty she was to perform in the 

aircraft during flight time on behalf of Green as the certificate holder. 

The AU observed that when Green asserted that Erin Daly required no training because 

she was a non-required attendant, the inquiry tumed to the question of Erin Daly's employment 

status, a key issue in settiement negotiations with the FAA. This inquiry went to the issue of 

whether Erin Daly was assigned for each flight to perform duty in the aircraft during flight time, 

and so should be considered a crewmember. 

The ALJ also observed that although this issue was discussed and agreed-upon through 

June 1, 2007, Green did not produce any records of Erin Daly's employment until in August 

2007 it produced an IRS Form 1099 listing $2,100 in "nonemployee" compensation. (Initial 

Decision at 6). 

"Without evidence of some employment relationship," the AU found, "there was nothing 

of record to preclude the possibility that an additional passenger, just by agreeing to serve drinks 

and sit in the jump-seat, could don the disguise of a non-required attendant and easily circimivent 

the nine-passenger limitation applicable to the CL-600." (Initial Decision at 6). 

As a result, the ALJ correctiy concluded that the FAA's action had a reasonable basis in 

law and fact. The AU found: 

Even though Green Air was not required to provide a qualified flight attendant, if Ms. 

Daly had acted as a flight attendant, then she would have been required to receive 

adequate training.^ If she served as a non-required attendant, then it would be reasonable 

^ There is no provision in the FAA's current rules that prevents an air 

carrier from providing a person acting, as here, a "drink server", some, but 

not all, flight attendant training. 

16 
to expect to see evidence of an employment relationship. In order to support Green Air's 

assertion that Erin Daly was not an un-manifested tenth passenger, it was reasonable for 

the FAA to ask for proof of an employment relationship. Green Air was unable, until 

eight months after the Complaint was filed, to provide any form of evidence of 

employment, albeit "nonemployee" employment. Green Air's various references to Erin 

Daly as "crew", "attendant", and "flight attendant" point to Green Air's own internal 

confusion as to her role and its compliance with training requirements. The legal inquiry 

and factual dispute are closely intertwined and satisfy the EAJA's requirement for a 

nexus between the two, 

(Initial Decision at 7), 

In addition, the ALJ correctly concluded fi-om the administrative record that Green's 

weight-and-balance sheets Ust the names of the two pilots and include data for the nine 

passengers; and that althoi^ the Captain denied it, the FAA investigator reported that the 

Captain did not include Erin Daly's weight in the weight-and-balance computation. (Initial 

Decision at 7).* 

The FAA had a reasonable basis for suspecting that Erin Daly's weight was not included 

in the weight and balance calculation, as her name was not described among the crewmembers on 

either of the two load manifests. Not including her weight in the aircraft total weight calculation 

could lead reasonably to the conclusion that Green operated the aircraft in a careless or reckless 

manner so as to endanger the life or property of another, in violation of 14 C.F.R. §91.13. 

Green's delay in providing the IRS 1099 form to the FAA had left unresolved in the 

interim the issue as to whether Erin Daly was a passenger or a crewmember. In light of the IRS 

1099 form that was eventually submitted. Green could have used Erin Daly as a crewmember 

(drink server) and such crewmembers have no training requirements. It is also possible that Erin 

Daly did not just work on the flights to and fi-om the Bahamas at $1600 charged to the customer 

^ Section 135.63 of the Federal Aviation regulations (14 C.F.R. §135.63) 

required Green to prepare an accurate load manifest before each takeoff that 

17 
for the services of an "attendant", but that she also did other work for Green and thus, that might 

explain why she made $2,100. 

The ALJ correctly concluded: "The factual disputes as to Erin Daly's role, training, and 

employment status, combined with the factual dispute as to computation of weight and balance 

establish that the FAA had substantial justification for its action." (Initial Decision at 7). 

CONCLUSION 

WHEREFORE, the FAA respectfiilly requests that Green's appeal of the denial of its application 

for attomey fees and expenses be denied in its entirety. 

Respectfully submitted, 

ALFRED R. JOHNSON, JR. 

Regional Counsel 

Christian Levj^r 

Attomey 

Tel: 718.553.3273 

Fax: 718.995.5699 

included the identification of crew members and their crew position 

assignments. 

18 
CERTMCATE OF SERVICE 

I hereby certify that on this date copies of the FAA's response to order for fiirther briefing was sent 

by Federal Express Overnight to the following: 

Federal Aviation Administration 

800 Independence Avenue, S.W. 

Washington, D.C. 20591 

Attn: Appellate Docket Clerk 

Gregory Winton, Esq. 

Aviation Law Experts, LLC 

One Research Court, Suite 450 

Rockville, MD 20850 

Tel: 301,294.8550 

Fax: 301.294.2525 

Dated: 0 ^ J^.?y\o 

Christian 

Attome;^ 

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